Media consolidation
Concentration of media ownership (also known as media consolidation) is a commonly used term among media critics, policy makers, and others to characterize ownership structure of mass media industries. These individual media industries are often referred to as a 'Media Institution'. Media ownership is said to be exemplified usually in one or more of the following ways. First there is a state of oligopoly or monopoly in a given media industry. For example, movie production is known to be dominated by major studios since the early 20th Century; before that, there was a period in which Edison's Trust monopolized the industry. The music and television industries recently witnessed cases of media consolidation, with Sony Music Entertainment's parent company merging their music division with Bertelsmann AG's BMG to form Sony BMG and TimeWarner's The WB and CBS Corp.'s UPN merging to form The CW. In the case of Sony BMG, there existed a "Big Five" (now "Big Four") of major companies, while The CW's creation was an attempt to consolidate ratings and stand up to the "Big Three" of American network (terrestrial) television. Second, there may be some large-scale owners in an industry that are not the causes of monopoly or oligopoly. Clear Channel Communications, especially since the Telecommunications Act of 1996, acquired many radio stations across the United States, and came to own more than 1,200 stations. However, the radio broadcasting industry in the United States and elsewhere can be regarded oligopolistic regardless of the existence of such a player. Because radio stations are local in reach, each licensed a specific part of airwave by the FCC in a specific local area, any local market is served by a limited number of stations. In most countries, this system of licensing makes many markets local oligopolies. The similar market structure exists for television broadcasting, cable systems and newspaper industries, all of which are characterized by the existence of large-scale owners. Concentration of ownership is often found in these industries. Third, concentration of media ownership often suggest the presence of media conglomerates. When a company owns many different types of media businesses, it is referred to as a media conglomerate. The seven current media conglomerates are Disney, CBS, Time Warner, News Corp, Bertelsmann AG, Viacom and General Electric. These companies together own more than 90% of the media market. Debates Concentration of media ownership is very frequently seen as a problem of contemporary media and society. When media ownership is concentrated in one or more of the ways mentioned above, a number of undesirable consequences follow, including the following: *For the general public, there are less diverse opinions and voices available in the media. *For minorities and others, fewer opportunities are available for voicing their concerns and reaching the public. *Healthy, market-based competition is absent, leading to slower innovation and increased prices. It is important to elaborate upon the issue of media consolidation and its effect upon the diversity of information reaching a particular market. Critics of consolidation raise the issue of whether monopolistic or oligopolistic control of a local media market can be fully accountable and dependable in serving the public interest. If, for example, only one or two media conglomerates dominate in a single market, the question is not only that of whether they will present a diversity of opinions, but also of whether they are willing to present information that may be damaging to either their advertisers or to themselves. If it is in the best interests of the media conglomerates not to run a story or allow a particular opinion, but in the best interests of the public interest to run it, it arguably makes better business sense to opt for the former over the latter. On the local end, reporters have often seen their stories refused or edited beyond recognition, in instances where they have unearthed potentially damaging information concerning either the media outlet's advertisers or its parent company. For example, in 1997, the Fox affiliate in Tampa, Florida fired two reporters and suppressed a story they had produced about one of the Fox network's major advertisers, Monsanto, concerning the health effects of Bovine Growth Hormone (BGH). Fox took action after Monsanto threatened to sue over the story. Consequently, if the companies dominating a media market choose to suppress stories that do not serve their interests, the public suffers, since they are not adequately informed of some crucial issues that may affect them. If the only media outlets in town refuse to air a story, then the question becomes, who will? Critics of media deregulation and the resulting concentration of ownership fear that such trends will only continue to reduce the diversity of information provided, as well as to reduce the accountability of information providers to the public. The ultimate consequence of consolidation, critics argue, is a poorly-informed public, restricted to a reduced array of media options that offer only information that does not harm the media oligopoly's growing range of interests. For those critics, media deregulation is a dangerous trend, facilitating an increase in concentration of media ownership, and subsequently reducing the overall quality and diversity of information communicated through major media channels. Increased concentration of media ownership can lead to the censorship of a wide range of critical thought. Another concern is that consolidated media is not flexible enough to serve local communities in case of emergency. This happened in Minot, North Dakota, in 2002, after a train filled with toxic chemicals derailed. None of the leading radio stations in Minot carried information on the derailment or evacuation procedures, largely because they were all owned by Clear Channel Communications and received automated feeds from the corporate headquarters in San Antonio, Texas. Scores of people were injured and one person died. Some typical counter-arguments to the criticisms above include the following: *Increased competitiveness due to the larger capital of the owners, especially to compete against some of the global, giant media conglomerates *Reduced cost of operations as a result of consolidation of some functions *More segmented or differentiated products and services to respond to a wider variety of demands better. An opposite evolution: massive diversification via citizen media On the other hand, a massive diversification of media, thanks to the Internet, materialized by millions of websites, fora, blogs and wikis is taking place. That evolution, often labelled citizen journalism or citizen media, makes it possible for practically everybody to be a media creator, owner and actor, instead of a passive user. Citizen media gradually take audiences out of the traditional media and weaken the role of information professionals. Traditional media are slowly trying to adapt by becoming more "participative", making their readers or watchers send their own news. Media consolidation in particular countries Australia Controls over media ownership in Australia are laid down in the Broadcasting Services Act 1992, administered by the Australian Broadcasting Authority. Even with laws in place Australia has a high concentration of media ownership. Ownership of national and the newspapers of each capital city are dominated by two coporations, Rupert Murdoch's News Corporation, (which was founded in Adelaide) and John Fairfax Holdings.These two coporations along with West Australian Newspapers and the Harris Group work together to create Australian Associated Press which distributes the news and then sells it on to other outlets such as the Australian Broadcasting Corporation. Although much of the everyday main stream news is drawn from the Australian Associated Press all the privately owned media outlets still compete with each other for exclusive Pop culture news. Rural and regional media is dominated by Rural Press Limited which is owned also by John Fairfax Holdings, with significant holdings in all states and territories. There are rules governing foreign ownership of Australian media and these rules are being considered for loosening by the current Howard Government. According to Reporters Without Borders in 2004, Australia is in 41st position on a list of countries ranked by Press Freedom; well behind New Zealand (9th) and United Kingdom (28th). This ranking is primarily due to the limited diversity in media ownership. The problem has even created a show in it self Media Watch (Australian TV series) on a government funded station Australian Broadcasting Corporation (ABC) which is one of two government administered free to air channels the other being Special Broadcasting Service(SBS). Canada Radio and television ownership in Canada is governed by the CRTC. The CRTC does not regulate ownership of newspapers or Internet media, although ownership in those media may be taken into consideration in decisions pertaining to a licensee's broadcasting operations. Apart from the public Canadian Broadcasting Corporation, commercial media in Canada are primarily owned by a small number of companies, including Bell Globemedia, Canwest Global, CHUM, Rogers, Standard, Shaw, Astral, Newcap and Quebecor. Each of these companies holds a diverse mix of television, cable television, radio, newspaper, magazine and/or internet operations. Some smaller media companies also exist. Due to Canada's smaller population, some types of media consolidation have always been allowed. In small markets where the population could not adequately support multiple television stations competing for advertising dollars, the CRTC began permitting twinstick operations, in which the same company operated both CBC and CTV affiliates in the same market, in 1967. This model of television ownership was restricted to smaller markets until the mid-1990s, when the CRTC began to allow companies to own multiple television stations in large markets such as Toronto, Montreal and Vancouver. As of 2005, almost all Canadian television stations are owned by national media conglomerates. These acquisitions have been controversial; stations in smaller markets have frequently had their local news programming cut back or even eliminated. For instance, CTV's stations in Northern Ontario and in Atlantic Canada are served by a single regional newscast for each region, with only brief local news inserts for headlines of purely local interest. This, in turn, has contributed to the rise of independent local webmedia such as SooToday.com, The Tyee and rabble.ca. Many, though not all, Canadian newspapers are also owned by the same media conglomerates which own the television networks. Companies which own both television and newspaper assets have strict controls on the extent to which they can merge the operations. The issue of newspaper ownership has been particularly controversial in Canada, especially in the mid-1990s when Conrad Black's Hollinger acquired the Southam chain. Black's 1999 sale of the Hollinger papers resulted in an increase in the diversity of newspaper ownership, with new ownership groups such as Osprey Media entering the business, but was even more controversial because the CRTC, waiving its former rules against broadcasting companies acquiring newspaper assets, permitted Canwest Global to purchase many of the Hollinger papers. The Toronto Star is a partial exception to this — it is owned by an independent company, but is itself a part owner of Bell Globemedia. In radio, a company is normally restricted to owning no more than three stations in a single market, of which only two can be on the same broadcast band. (That is, a company may own two FM stations and an AM station, or two AMs and one FM, but may not own three FMs.) Under certain circumstances, local marketing agreements may be implemented, or the ownership rule may be waived entirely. For example, in Windsor, Ontario, CHUM Limited owns all of the city's commercial broadcast outlets, due to the city's unique circumstances — being in the immediate environs of the Metro Detroit market in the United States, Windsor has historically been a difficult market for commercial broadcasters, so the CRTC waived its usual ownership restrictions to help protect the Windsor stations' financial viability. When licensing a new broadcast outlet, the CRTC has a general (but not strict) tendency to favour new and local broadcasters. However, in the modern media context such broadcasters often struggle for financial viability, and are often subsequently acquired by larger companies. The CRTC rarely denies the acquisition applications. Canada also has strict laws around non-Canadian ownership of cultural industries; a media company in Canada may not be more than 20 per cent foreign-owned. Europe Axel Springer AG is one of the largest newspaper publishing companies in Europe, claiming to have over 150 newspapers and magazines in over 30 countries in Europe. Bertelsmann is one of the world's largest media companies, and has close links with the science and technology publisher Springer Science+Business Media, which was created from Bertelsmann's majority purchase of Springer-Verlag in 1999 and then a merger with Kluwer Academic Publishers in 2003. Silvio Berlusconi, the former Prime Minister of Italy, was the owner of the three largest italian TV stations, and gained control of the three state owned stations on his elections, a control he has not refrained from excercising. United States Little mass media regulation existed in the United States prior to the creation of the Federal Radio Commission in 1927. The Telecommunications Act of 1934 was a fundamental decision on how mass media would function from then on. At the time, radio technology had become widespread among the masses, and the electromagnetic spectrum was regarded as public property. The Act reappropriated the spectrum to itself, and claimed the right to assign spectrum ranges to private parties as long as they broadcast in the public interest. This act created the Federal Communications Commission to replace the Federal Radio Commission. Lobbyists from the largest radio broadcasters, ABC and NBC, successfully petitioned to attach a cost to the license required to broadcast, and were thus able to "price out" many amateur broadcasters that had previously existed. Such was the precedent for much of the following regulatory decisions, which have mostly focused on the percentage of a market deemed allowable to a single company. The largely unpublicized Telecommunications Act of 1996 set the modern tone of "deregulation," a relaxing of percentage constrictions that solidified the previous history of privatizing the utility and commodifying the spectrum. The legislation, touted as a step that would foster competition, actually resulted in the subsequent mergers of several large companies, a trend which still continues. The FCC held one official forum, February 27, 2003, in Richmond, Virginia in response to public pressures to allow for more input on the issue of elimination of media ownership limits. Some complain that more than one forum was needed. http://www.richmond.com/business/output.aspx?id=2414262 http://www.american-buddha.com/media.ownership.htm On June 2, 2003, The U.S. Federal Communications Commission (FCC), in a 3-2 vote, approved new media ownership laws that removed many of the restrictions previously imposed to limit ownership of media within a local area.The changes were not, as is customarily done, made available to the public for a comment period. Two commissioners requested this public comment period (the same two who voted against the changes) and their requests were denied without justification. The news coverage of this event in the mainstream press was very low-key. A few of the points included: * Single-company ownership of media in a given market is now permitted up to 45% (formerly 35%, up from 25% in 1985) of that market. * Restrictions on newspaper and TV station ownership in the same market were removed. * All TV channels, magazines, newspapers, cable, and internet services are now counted, weighted based on people's average tendency to find news on that medium. At the same time, whether a channel actually contains news is no longer considered in counting the percentage of a medium owned by one owner. ::(Thus it is now possible for two companies to own all of a city's 2 newspapers, 3 local TV stations, 2 national TV networks, and 8 local radio stations, (up to 45% of the media each) so long as there are other companies owning the shopping channel, the discovery channel, and at least 10% of other non-news outlets.) * Previous requirements for periodic review of license have been changed. Licenses are no longer reviewed for "public-interest" considerations. More information on the new consolidation rules is available from the FCC website. In particular, there are press releases from the commissioners who voted for the changes, and from those who voted against them. By corporation * Disney, "New" Viacom (and its former parent CBS Corporation, the former "Old" Viacom), TimeWarner, Rupert Murdoch's News Corp, Bertelsmann AG, and General Electric together own more than 90% of the media holdings in the United States. Among other assets, Disney owns ABC, Buena Vista Motion Pictures Group, ESPN, and Miramax Films; CBS Corporation owns CBS, CBS Radio (formerly Infinity Radio)Simon & Schuster editing group, etc.; Time Warner owns CNN, Time, AOL, etc.; Bertelsmann owns Arvato, Direct Group, RTL Group (which owns M6 TV channel, VOX and Five), etc. *Lagardère Group owns Hachette Filipacchi Médias, which is the largest magazine publisher in the world, 100% of Lagardère Media, 34% of CanalSat, and Hachette Livre (as well as parts in the European military aerospace EADS company). *Vivendi owns Canal + Group. *Edouard de Rothschild has 37% of French left-wing daily Libération since 2005, while arms company Dassault owns 82% of the Socpresse, which controls conservative Le Figaro, in which the Carlyle Group previously had 40%, as well as L'Express. Le Monde is owned by La Vie Le Monde, which also controls Télérama and other publications of La Vie Catholique, as well as 51% of Le Monde diplomatique. *French Bouygues company owns 42.9% of TF1 TV channel, and is the parent company of Bouygues Télécom. *Rupert Murdoch, the media magnate, apart of News Corp., also owns British News of the World, The Sun, The Times, and The Sunday Times, as well as the Sky Television network, which merged with British Satellite Broadcasting to form BSkyB; in the US, he owns the Fox Networks and the New York Post. Since 2003, he also owns 34% of DirecTV Group (formerly Hughes Electronics), operator of the largest American satellite TV system, DirecTV, and Intermix Media (creators of myspace.com) since 2005. See also Murdoch Newspaper List. *Modern Times Group, quoted on the Stockholm Stock Exchange, owns Viasat TV network and Metro International, which is the world's largest chain of free newspapers, publishing 57 daily Metro editions in 18 countries. It was started as a direct competitor of 20 Minuten. * UK Daily Mail and General Trust plc * Bolloré group, owned by Vincent Bolloré, who is Havas's main share-holder and president and UK group Aegis' first share-holder. Bolloré owns Direct 8 French TV channel. External links *Essay examining the reasons and consequences of media ownership *Free Press an organization opposing media ownership concentration *Lasar's Letter on the Federal Communications Commission Media ownership controversy timeline, 1996-2004 *Media ownership study ordered destroyed For changes: *Chairman Powell *Commissioner Martin *Commissioner Abernathy Against: *Commissioner Copps *Commissioner Adelstein References * Orwell Rolls in His Grave (2004) documentary available on DVD considers media concentration in the U.S. Credit and categories Category:Media Category:C Category:M